Hedge Fund Moguls Put
Money On Asian Internet, Low-Volume Stocks
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[May 17, 2014]
By Svea Herbst-Bayliss
LAS VEGAS (Reuters) - From
Asian Internet stocks, which have boomed over the last
year, to food and paper products companies, prominent
hedge fund investors listed their favorite stocks on
Thursday at an industry meeting dominated by talk of
where markets will move.
John Burbank stuck with the Chinese Internet stocks that helped
boost returns at his $3.8 billion Passport Capital last year. Real
estate Internet portal Soufun Holdings, which climbed 121 percent in
the last year, and discount online retailer Vipshop Holdings, which
climbed 417 percent in the last year, made the list as his
"I am not negative on U.S. Internet companies but China is trading
at a bigger discount," Burbank said at the annual SkyBridge
Alternatives Conference known as SALT.
Burbank, whose picks have long included international companies and
who taught in English in China decades ago, said "China is
fundamentally changing and there is something to bet on." This year
Burbank's flagship fund is up 0.5 percent through April, a person
familiar with the number said.
Leon Cooperman, who runs $10.5 billion Omega Advisors, still likes
banking company Monitise, listing it for the second straight year as
a favorite and saying that its price can double in a year.
Cooperman also sounded a more positive note on the U.S. stock market
at a time some other prominent hedge fund managers have issued a
note of caution about how much higher equities can move. Although
stocks moved to record territory earlier this week, the S&P 500 has
been struggling to move meaningfully higher this year after gaining
30 percent last year.
He said U.S. stock prices are not a bargain but noted that the
market "isn't priced to perfection" either, forecasting that the S&P
500, now trading at 1,870 could end the year at 2,000.
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Steve Kuhn, head of fixed income trading at $14 billion Pine River
Capital Management, advised selling out of bonds and moving into low
volatility stocks, calling these types of companies "boring but
He included food company ConAgra and paper and packaging
manufacturer Rock-Tenn as picks. With Rock-Tenn he joked "this is a
company that will not be disinter- mediated by Google."
Cooperman said stocks are still the best alternative among financial
assets and likened investing in U.S. government bonds to trying to
walk in front of a steamroller to pick up a dime.
Meanwhile Michael Novogratz, a principal at Fortress Investment
Group, said that a sizable bet against U.S. Treasuries "makes
(Editing by Eric Walsh)
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